In north Boulder, work is moving forward on a grocery store that is steeped in mystery and already drenched in controversy.

Months after fliers circulated in north Boulder claiming that Walmart was eyeing the opening of a local store, the buzz and speculation have continued to grow that the Bentonville, Ark.-based retail giant is behind a project to build a nearly 52,000-square-foot grocery store at Diagonal Plaza, off 28th Street and Iris Avenue.

"I heard about three to four weeks ago that it was Walmart, but it wasn't definitive," Boulder Mayor Matt Appelbaum said. "I wasn't hearing that from the city. It was a third party and, once again, nothing definitive."

A Walmart Neighborhood Market in Aurora. Boulder Mayor Matt Appelbaum said he s heard Walmart may be behind the project to build a nearly 52,000-square-foot grocery store at Diagonal Plaza. (ALICIA WALLACE)

Appelbaum said he and council members have received several emails from residents opposed to Walmart opening a store in the city. However, neither council members nor city officials have been able to provide a firm answer -- mostly because of a stealthy approach taken by the property owner and prospective tenant.

"I have no new information about any proposed Walmart," said Liz Hanson, the city's economic vitality coordinator. "The city planning staff has gone back and looked at the building permits to make sure if there's any tenant name, and from what they are indicating, they don't have a tenant name.

"I have had no conversations with Walmart for years."

The project that involves combining the long-vacant Ross and PetSmart stores at Diagonal Plaza into a 51,836-square-foot retail grocery store is identified only as "Boulder (Diagonal), CA" in building permits filed with the city. Aside from modification and building permit applications submitted by the property owner of 3303 30th St. and an Oklahoma architecture firm, the store's operator has not directly contacted the city, nor has it made its intentions public.

A Walmart cart corral resembling one submitted in plans for the grocery store at Diagonal Plaza. (ALICIA WALLACE)

Walmart officials, the space's property owner and the architect behind the project could not be reached for comment.

Signs of similarities

In addition to the word on the street, other signs have emerged recently that seem to increase the likelihood that Walmart could be the mystery tenant behind the grocery store at Diagonal Plaza.

Several grocers such as Whole Foods, Natural Grocers by Vitamin Cottage and King Soopers -- the Kroger brand that previously expressed interest in opening a store at Diagonal Plaza -- told the Camera last week that they are not the operator of the 3303 30th St. store.

Also, the floor plans and certain notations included in the permit applications appear to share similarities to aspects of existing Walmart Neighborhood Market locations.

A walk through the Walmart Neighborhood Market off Chambers Drive in Aurora revealed a layout that closely resembles the floor plan of 3303 30th St. In the parking lot of the northeast Denver store, the cart corrals carried a strong likeness to renderings of cart corrals included in the Boulder building permit application.

The building permits filed with the city identified the retail location as "Store #3096." A store search on Walmart.com reveals that the company has a store No. 3096 in Ontario; however, it also appears that some Neighborhood Market store numbers overlap with existing Walmart store numbers.

A cart corral included in the plans filed with the city of Boulder for 3303 30th St. in Diagonal Plaza.

Of the five Denver-area Neighborhood Market stores -- which have store numbers that range from 3019 to 3128 -- two have store numbers that overlap with Canadian Walmarts.

Additionally, the combination of certain paint colors -- such as "Jonquil" and "Humble Gold" -- and wire-mounted shelving listed in the 3303 30th building permit also have been listed in building plans posted online for Neighborhood Market locations.

Walmart's 'Neighborhood Markets'

Walmart launched the grocery-focused Neighborhood Market concept in 1998. The approach of the store and the smaller footprint -- a store averages about 38,000 square feet -- allowed the retailer to enter different markets, including more urban settings.

The Neighborhood Market stores also helped Walmart in its efforts to land an "hourglass" demographic and appeal to higher-income shoppers while maintaining its lower-income customer base, said Robin Sherk, a senior analyst at Kantar Retail who serves as the lead analyst on the consultancy's syndicated research on Walmart.

Walmart took a slow and steady approach to expanding its Neighborhood Market store base until this year, when the company embarked on plans to add 80 markets to the concept's 170 stores, she said.

As Walmart has gone about this coast-to-coast expansion, the retailer has tweaked aspects of the offerings and tailored the products for specific locales, Sherk said. Walmart's roughly 60,000-square-foot store in Plano, Texas, for example, included departments such as electronics and automotive.

Walmart is not one to shy away from entering markets where some residents might not view the company in a favorable light, she said, noting some resistance and backlash that came from areas such as Boston and parts of California.

When Walmart made a play to open a store in Boulder in the past, residents and some City Council members pushed back against the idea of a large-scale big-box retailer opening. Others locally and nationally have vocalized opposition to the retailer, citing the company's business practices, labor policies and lawsuits surrounding working conditions.

In past situations when Walmart has opened stores in markets where negative sentiment is prevalent, the retailer has concurrently announced a donation to a local organization or school as part of its grand opening events, Sherk said.

Sharing the pie

It's unclear whether the entrance of the grocery tenant could spur further activity at Diagonal Plaza, a commercial district identified by the city as ripe for redevelopment, noting the plaza's decline in physical appearance and drop in contributions to the city's sales tax base.

However, the possibility of a larger-scale redevelopment project on the site could be hindered not only by economic factors but also the nature of the center's ownership structure, officials have said. About 15 different entities own buildings and land on the 33-acre site.

The construction activity related to the new grocer is the first significant development activity and movement at Diagonal Plaza in years, and initial sentiment from residents was mixed, said Hanson, the city's economic vitality coordinator.

"I think there are some people who feel strongly that more variety in retail choices in Boulder is needed, that we're losing sales tax revenue (to other communities) and that we need more affordable choices," she said. "There are other people who feel like Boulder does not need more big-box stores, that it's not consistent with the character of Boulder."

Mel Kimura Bucholtz, a resident of a nearby neighborhood, is one of those who opposes a Walmart in the area.

“Boulder is small town and Walmart's presence, as it has done elsewhere, will harm other retailers, be a model of poor treatment of its employees and negatively impact surrounding neighborhood property values,” he said in an email. “In Santa Fe, where I lived, Walmart is far enough away from the city center to not harm/interrupt the quality of city life. Not to mention the amount of increased higher-carbon pollution emissions, in a city that prides itself on air quality.”

If Walmart is indeed the company behind the grocery store at Diagonal Plaza, Boulder's mayor said the smaller approach could have less of an effect than a 180,000-square-foot Supercenter.

"I think you do have to really distinguish between big-box anything with something of this size," Appelbaum said. A 100,000-square-foot big box is "not what's in front of us. It's a much smaller deal, and that does change things a lot.

"The impacts of it -- the actual impact, and I'm not talking about the philosophical disagreements with Walmart -- yeah, it makes a big difference."

Appelbaum conceded that if the store opens as billed on the building permit -- as a grocery store -- it would be "disappointing." Noting the plethora of grocery stores within the city of Boulder, Appelbaum said another grocer would only be spreading around the existing sales tax base.

"It's a little hard to see that the pie is going to get much bigger," he said.

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